LONDON: Spanish bond yields fell to new record lows on Friday, with traders citing a Reuters report saying ECB officials were considering ways to ensure weak countries that stand to gain most from money printing bear more of the risk and cost.
Officials, who spoke on condition of anonymity, have told Reuters that the ECB could require central banks in countries such as Greece or Portugal to set aside extra money or provisions to cover potential losses from any bond-buying, reflecting the riskiness of their bonds.
"In so far as it shows the very detail of QE is being discussed it should be read as positive," said Richard McGuire, senior fixed income strategist at Rabobank.
"It may be a watered-down form of QE but from a markets perspective, we would rather have an imperfect QE now than perfect QE much later." Spanish 10-year yields fell to a new record low of 1.72 percent. Other peripheral yields also fell, while the euro edged towards a 28-month low against the dollar and was last trading at $1.22575, down a quarter of a percent on the day.
Comments
Comments are closed for this article.